The Surroundup


  • by Gillian Stovel Rivers, MA, CFP®, CEA
  • November 24, 2023

This month’s Surroundup is all about fixing your H.A.L.O.

That’s right. As we continue to find ourselves in a world of conflict and polarized extremism, and at the same moment entering the season of giving and gratitude, I wanted to visit on one of the other biggest topics of the last two years that has had a great impact on so many: the cost of living.

At Surround we often talk about focusing on what is important, that is also something you can control. Well, it turns out with a little reframing and reflection, the cost of living in general is not only always going to be important but it is also something we can do something about.

But first, three stories.

The first story happened when I was training at the pool early last Thursday morning. My coach had programmed me a series of fully underwater lengths of the pool, a series of 100m sets, and a series of 200m sets, finishing up with yet another series of 100m sets.

What you quickly learn from swimming once you have the strokes under control is that this sport is all about budgeting your use of air. Breath management. Taking in everything that you can and rationing it as long as you can until your next breath, to maintain speed.

Full length of the pool underwater? That is a lesson in learning how to not panic when the oxygen starts to run low. 100s for me have been an opportunity to learn how to do as many strokes as possible – 4 strokes, 6 strokes and this past week as many as 8 strokes – between breaths while not giving up too much speed. 200s though they may start the same way, end up down to 2 stroke breathing by the 7th lap. This is how I can remain calm, retain speed and stay in control of my mind on the longer distance sets. I’m learning to budget my oxygen and remain flexible with my mental response to having less.

The second story is about the tech sector. Specifically, the tech sector now in an environment of higher interest rates versus the tech sector we all knew and loved pre-January 2022. I read an article earlier this week that explained “pre-rate hike” tech was all about revenue growth NOT earnings growth. Companies could count on increasing stock prices so long as their revenues were growing. The article used the words “empty calories” to describe how companies were incentivized to pursue low/no margin revenues, which created many distortions. Okay now throw a 4x on the cost of borrowing into that equation. Now what do they have to care about? Margins. Profits. AKA earnings growth. Can they make a PROFIT money when money costs money? That is a far greater measure of a company’s value so at the end of the day, a very useful adaptation. 

Financial adversity in the form of higher interest rates is breeding better business. Not unlike learning to swim further on less oxygen inevitably makes me a stronger and faster swimmer.

Okay Gillian, we get it. So how does this affect me? 

Bear with me, one more story…

We hosted a family birthday party a few weeks ago, and I was thrilled to see my eldest son remain at the dinner table afterwards to chat with the grown-ups. Sam (he is 16 and just got his G2 so we are totally best friends now because I have a car), and my Dad, Gord, ended up chatting.

“Papa,” asked Sam, “What would I need to know and think about to be good at what Mom does?” My Dad went on to brilliantly break it down to three key ideas, one of which was becoming conversant and thoughtful at both macro- and microeconomics. Macro – how did the tech sector respond to inflation and increasing interest rates? Micro – how are grocery shopping and vacation planning impacted by inflation and increasing interest rates? A very actionable concept for a young man to walk away and chew on for a while, and a thoroughly accurate distillation of what his mom does for a living.

Like the title of this article suggests, if you have felt an increasing pressure from the change in the cost of living these past two years, here is an exercise I call H.A.L.O that’s designed to help you reframe your relationship with how you invest your money.

Step 1) Print your bank feed and your most used credit card feed from the last 3-12 months. Yes 12 months is a long time, and you get out what you put in. The longer the time period, the greater focus you’re going to have to have to wade through it, but also the greater impact your findings will have.

Step 2) List or highlight every expense into FOUR (4) categories:

H: Health

A: Activity values

L: Longevity

O: Other / On the chopping block

Investments in your daily well-being (groceries, personal training, yoga, gym membership, massage, chiropractor, therapy).

Activity values
Investments that support what lights you up, gives your life meaning, areas such as business, impact, family, friends, learning, health and fitness, peak experiences.

Investments are things you have invested in now because they will compound and return that investment to you in the form of greater health span. More years being well, happy and connected.

Other, or On the chopping block
These are ways that you spend money that don’t support any of the above and may not feel exactly like investments in your life. These may be general inescapable overhead that didn’t quite inspire you as any of the above, it also may be uses of income or capital that aren’t going to return value to you in any meaningful way and could possibly be cut.

Step 3) Total up, discuss, evaluate, cut, honour, celebrate. Review the meaning in how you INVEST when you spend money. The first three categories will absolutely lead you to feeling your own EARNINGS GROWTH.

Step 4) Gut check the whole list. Is that really an investment in your activity values, health, or longevity, or is it what someone else in someone else’s life values? Is it something you started a while back but no longer serves you? Move items around, and arrive at a list of subcategories and monthly or annual dollar totals under each heading in H.A.L.O.

Ultimately this exercise helps us to see what we do with our money as investing at every turn.

Expenses sound so negative like they are a bad thing. Spending is also a bit of a leaky word. I mean sure if you’re a tech company circa 2021 go ahead knock yourself out spend away because folks are going to bid up your stock price no matter what. But will that allow you to turn fast at the wall and hit the next lap with enough oxygen to make it the distance when interest rates change? No it won’t (and thank you for humouring my mixed metaphor). Knowing your financial cadence, investing your resources into the way you live your best life, and the value it’s going to return to you is a very empowering way to live.

H.A.L.O. puts you in mindfully in charge of how you continue to invest your money – your “financial oxygen” – to remain adaptive and capable of feeling confident when the rules of the game suddenly change around you.

I hope you like this perspective. Please forward it to someone you think might benefit from it. Perhaps we can provide even more value to them through our blogs, our videos or from working together.

Times are tough and always changing. At Surround we’re not just thinking about the next day, we’re thinking about the next level. Right there beside you every step of the way.

See you next month for the Holiday Edition. Be well, stay connected, and remember there’s more than one way to wealth.

By Gillian Stovel Rivers, MA, CFP, CEA
Surround Wealth Advisors
Assante Financial Management Ltd.
November 13, 2023


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